The number of new buy-to-let companies is on course to fall for the first time since 2008 as the rush by existing landlords to incorporate their portfolios loses momentum.

Landlords set up 41,483 buy-to-let companies across Great Britain during the first eight months of 2026, according to new analysis from Hamptons.

That was 8% fewer than the 44,802 created over the same period last year.

The slowdown accelerated in August. New incorporations fell 22% year-on-year, from 5,363 to 4,198.

If the trend continues, 2026 will record the first annual decline in new buy-to-let company formations for 18 years.

However, the overall number of buy-to-let companies continues to increase. There were 469,165 operating across Great Britain at the end of August, up from 443,272 at the end of 2025.

New company formations are also still running at around eight times the level recorded a decade ago.

Landlord portfolio transfers slow

Hamptons says the change largely reflects a slowdown in landlords transferring personally owned properties into limited companies.

Changes to landlord taxation from 2016 onwards helped drive the incorporation boom. In particular, restrictions on mortgage interest tax relief made personal ownership less attractive to many higher-rate taxpayers.

Further tax changes have subsequently increased the appeal of company structures for some landlords.

However, much of the growth came from existing investors restructuring their portfolios rather than buying additional properties.

Around 81,800 properties entered buy-to-let limited companies across England and Wales during 2025, according to Hamptons.

Of these, around 43,400, or 53%, were transferred from personal ownership rather than acquired as new buy-to-let investments.

Hamptons estimates that the average Stamp Duty Land Tax bill on these transfers was around £28,000, based on an average property value of £380,000. That generated an estimated £1.2bn for the Treasury.

New purchases overtake transfers

Hamptons believes the market has now passed the peak for portfolio transfers.

Many landlords who stood to gain most from incorporation have already made the switch. Others can face significant upfront costs because transferring a property may trigger both stamp duty and Capital Gains Tax.

As a result, new purchases are beginning to account for a larger proportion of properties entering company structures.

Hamptons estimates 51% of properties entering buy-to-let companies so far this year were new purchases, rather than transfers.

The shift could also reduce the Treasury’s stamp duty receipts from landlords restructuring existing portfolios.

Future incorporation levels are therefore likely to depend more heavily on landlords buying additional properties and overall investor sentiment.

New-let rents accelerate

Meanwhile, Hamptons recorded another acceleration in rental growth during August.

The average rent on a newly let property across Great Britain reached £1,419 per month, up 2.4% year-on-year.

It was the tenth consecutive month in which the annual growth rate increased and the fastest pace since November 2024.

Markets outside London led the increase. New-let rents rose 5.4% in the South West and 3.7% in the South East.

The North also crossed a significant threshold. Average rents on newly let properties exceeded £1,000 per month for the first time, reaching £1,014.

That was 2.8% higher than the £986 recorded a year earlier.

Greater London remains considerably more expensive, with the average new-let rent reaching £2,334. However, annual growth was more subdued at 1.2%.

Across all tenancies, including tenants who remained in their existing homes, average rents increased 2% to £1,260 per month.

That leaves existing tenants paying an average £159 per month less than someone moving into a new rental property.

Aneisha Beveridge, head of research at Hamptons, said: “A large part of the buy-to-let incorporation boom was driven by the one-off structural shift whereby existing landlords transferred properties they already owned into limited company structures in response to tax changes. But we’re now reaching the tail end of that trend. Increasingly, the landlords who stand to benefit financially from incorporating existing properties have already done so.

“While limited companies remain the preferred structure for most new investors entering the market, it’s likely that new company formations peaked in 2025. Moving forward, growth is likely to increasingly depend more on landlords making new purchases than restructuring portfolios. That also means the Treasury’s Stamp Duty windfall from these transfers is likely to start falling.

“Rental growth for new lets has been steadily gathering pace for nearly a year now, with much of that increase being driven by markets outside London. The arrival of the Renters’ Rights Act seems to be adding further pressure. Higher compliance costs and extra administration have left prospective tenants facing increased prices to secure new tenancies, even while existing renters are seeing more modest increases.”